In 1982 Atari's Home Computer Division (HCD) introduced the new replacement
computer to its aging Atari 400/800 line. The new computer
brought to Atari's home computers line a high-tech and sleek low profile
modern look. The case design and the "XL Look" were created
by Regan Cheng of Atari's Industrial Design group. The all new
design took the 7 separate boards that made up the Atari 800 (Main, Power,
CPU, OS and 3 16K Memory boards) and integrated them into a single motherboard
with 64K of memory. The system also brought with it probably
"THE" best keyboard for any Atari system.

The system featured many
new internal and external enhancements. Some of the obvious ones
were the new Function keys and built-in HELP key that programmers could incorporate
their usage into future programs. The tangle of wires from the
system were now out of the back making for a clean and uncluttered arrangement.
The cartridge port and controller jacks were now on the left side of the
system. The new OS was designed for a new era of
SIO "Plug n Play" devices to automatically load their device drivers and even
on-board applications right into the 1200XL memory, also an International Character Set and built-in Diagnostic features
were now part of the system. Other OS enhancements were
included as well.

However the downside was
that many programs by both 3rd party companies and even Atari itself were
incompatible with this new OS in the machine. The loss
of 2 of the 4 original controller jacks from the earlier Atari 400/800 systems
didn't seem like much of a big deal to the 1200XL engineers, however the
end users did seem to mind. The system was supposed
to have a better video display output signal, however to most end users, the system
appeared to have a fuzzier display then the Atari 800. The true
sticking point for consumers: No expansion whatsoever.
While the idea of a "Closed Box" design seemed like a good idea to Atari's
Marketing Department, the consumer felt exactly the opposite.

Atari's whole design philosophy
for their home computer line was that these would be Consumer Oriented, not
Hobbyist Oriented Systems. Therefore that meant buffering the
user from the actual electronics and chips within the machines.
This design was very well executed on the Atari 800 with its easy to remove
top cover and its various OS and Memory modules fitted into easy to install
packages. The SIO connector also gave users a universal, easy
to handle and understand expansion system. Atari felt it
could take this philosophy to the extreme with the 1200XL and completely
cut the users off from ANY internal access. Even the simplest
of users still wanted to tinker and expand their systems and the 1200XL just
didn't give them the flexibility found in Apple ][e's, C64s or Atari's original
800 line of computers. The collective shortcomings
of the 1200XL unfortunately overshadowed its many new enhancements.
Atari's new prodigy became its "Edsil" The
introduction of the new 1200XL actually increased sales of the Atari 800.
Users began to buy 800's in fear that they would be stuck with a closed and
incompatible system.